Treasury and Resources
Ministerial Decision Report
EPGDP funding allocation ER01 - Brexit
- Purpose of Report
To enable the Minister for Treasury and Resources to approve a non-recurring budget transfer of up to £604,000 in 2017 and up to £534,000 in 2018 to the Ministry of External Relations revenue head of expenditure, and up to £120,000 in both 2017 and 2018 to the Chief Minister’s Department revenue head of expenditure, from the Economic and Productivity Growth Drawdown Provision (EPGDP) within Central Contingencies. Also to allow the Minister to approve a staffing increase of 5.0 FTE in the External Relations Department to the end of 2018.
- Background
The United Kingdom’s (UK) unexpected vote to leave the European Union (“Brexit”) has potential consequences for Jersey. It will require a range of responses across government if the Island is seize upon the opportunities and challenges that may develop.
A business case detailing how government may need to respond to Brexit has been reviewed by the EPGDP Officer Group and was supported politically by the Economic Policy Political Oversight Group. It not possible to precisely determine how Jersey will be affected by Brexit until more is known about the UK’s future relationship with Europe. Therefore the decision has been taken to ring-fence resources within the EPGDP, a provision that sits within central contingencies, to enable the full range of responses that may be necessary and bids in respect of these funds will be considered for release by the Minister when there is greater clarity over the UK’s future direction. All future funding remains subject to the approval of the MTFP.
In the meantime, some funds are required immediately to ensure that the Island is able to respond to developments as the UK’s relationship with Europe evolves. Therefore funding will be allocated to the External Relations and Financial Services Teams within the Chief Minister’s Department and the Law Officers’ Department. EPGDP funding will enable an expansion in diplomatic engagement with the UK, our European neighbours and any potential new trading partners. Work will also be undertaken to scope the impact that Brexit will have on the Island’s legislation and develop any necessary legislative changes. Funding will be allocated as follows:
| 2016 | 2017 | 2018 | 2019 | Total |
External Relations (CMD) | 121,000 | 604,000 | 534,000 | - | 1,259,000 |
Financial Services (CMD) | 14,000 | 120,000 | 120,000 | - | 254,000 |
Law Officers’ Dept. | 13,000 | 110,000 | 110,000 | - | 233,000 |
Total | 148,000 | 834,000 | 764,000 | - | 1,746,000 |
Any underspends will be assumed to return to the EPGDP.
At their meeting of 7th September 2016, the Council of Ministers recommended to the Minister for Treasury and Resources to agree to allocate up to £135,000 in 2016, up to £724,000 in 2017 and up to £654,000 in 2018 to the Chief Minister’s Department revenue head of expenditure and up to £13,000 in 2016, up to £110,000 in 2017 and up to £110,000 in 2018 to the Law Officers’ Department revenue head of expenditure from the Economic and Productivity Growth Drawdown Provision (EPGDP) within Central Contingencies. The Minister for Treasury and Resources was requested to effect these transfers.
MD-TR-2016-0074 was signed by the Minister for Treasury and Resources on 14th September 2016 to effect this allocation. From 2017 External Relations has become a separate department and head of expenditure (per the MTFP Addition 2017-2019 (P.68/2016) approved by the States Assembly on 1st December 2016), hence there is a need to allocate the previously approved funding between the Chief Minister’s and External Relations revenue heads of expenditure in accordance with the Council of Ministers’ decision.
3. Recommendation
The Minister is recommended to approve:
- a non-recurring budget transfer of up to £604,000 in 2017 and up to £534,000 in 2018 to the Ministry of External Relations revenue head of expenditure, and up to £120,000 in both 2017 and 2018 to the Chief Minister’s Department revenue head of expenditure, from the Economic and Productivity Growth Drawdown Provision (EPGDP) within Central Contingencies; and
- a staffing increase of 5.0 FTE in the External Relations Department to the end of 2018..
4. Reason for Decision
Article 17(2) of the Public Finances (Jersey) Law 2005 states that the Minister for Treasury and Resources is authorised to approve the transfer from contingency expenditure to heads of expenditure of amounts not exceeding, in total, the amount available for contingency expenditure in a financial year.
The current Contingency Allocation Policy (published as R.10/2012) sets the requirement for all allocations from Contingency to be considered by the Council of Ministers prior to submission to the Minister for approval.
To comply with P.67/1999 which charges the Minister for Treasury and Resources to regulate the number of persons that may be employed by the States.
The Council of Ministers agreed at their meeting of 7th September 2016 to recommend to the Minister for Treasury and Resources to allocate up to £135,000 in 2016, up to £724,000 in 2017 and up to £654,000 in 2018 to the Chief Minister’s Department revenue head of expenditure from the Economic and Productivity Growth Drawdown Provision (EPGDP) within Central Contingencies, together with an increase in staffing of 5.0 FTE.
MD-TR-2016-0074 was signed by the Minister for Treasury and Resources on 14th September 2016 to effect this allocation. From 2017 External Relations has become a separate department and head of expenditure (per the MTFP Addition 2017-2019 (P.68/2016) approved by the States Assembly on 1st December 2016), hence there is a need to allocate the previously approved funding between the Chief Minister’s and External Relations revenue heads of expenditure in accordance with the Council of Ministers’ decision.
Decision MD-C-2017-0053 was signed by the Chief Minister on 12th May 2017 and decision MD-ER-2017-0015 was signed by the Minister for External Relations on 4th May 2017.
5. Resource Implications
The Ministry of External Relations revenue head of expenditure to increase by up to £604,000 in 2017 and up to £534,000 in 2018 and the Chief Minister’s Department revenue head of expenditure to increase by up to £120,000 in both 2017 and in 2018.
The EPGDP within Central Contingences will decrease by the same amounts.
Staffing levels in the External Relations Department will increase by 5.0 FTE until the end of 2018
This decision does not change the total amount of expenditure approved by the States in the Medium Term Financial Plan.
Report author : Head of Decision Support | Document date 19th April 2017 |
Quality Assurance / Review : Director of Financial Planning and Performance | File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DS, WR and SD\2017-00xx - EPDGP Brexit split CMD and ER |
MD sponsor : Director of Financial Planning and Performance |